New Everything for SEC's "Crypto Assets and Cyber Unit"

Author

Bruce Carton
May 03, 2022

Hey, we're back for Day 2 of the new and improved Daily Update from Securities Docket! Let's get after it.

Clips ✂️

SEC Nearly Doubles Size of Enforcement’s Crypto Assets and Cyber Unit

The Securities and Exchange Commission today announced the allocation of 20 additional positions to the unit responsible for protecting investors in crypto markets and from cyber-related threats. The newly renamed Crypto Assets and Cyber Unit (formerly known as the Cyber Unit) in the Division of Enforcement will grow to 50 dedicated positions.

“The U.S. has the greatest capital markets because investors have faith in them, and as more investors access the crypto markets, it is increasingly important to dedicate more resources to protecting them,” said SEC Chair Gary Gensler. “The Division of Enforcement’s Crypto Assets and Cyber Unit has successfully brought dozens of cases against those seeking to take advantage of investors in crypto markets. By nearly doubling the size of this key unit, the SEC will be better equipped to police wrongdoing in the crypto markets while continuing to identify disclosure and controls issues with respect to cybersecurity.”

by SEC Press Release

Securities Docket: Big changes are in motion for this specialized unit that will now fill 20 new positions, take on a new name that reflects the emergence of Crypto as a huge priority, and also apparently have a new leader. The WSJ reports that Kristina Littman, the unit’s current chief, "has announced internally that she plans to leave the agency in June."

SEC Charges CEO and President of Synergy Settlement Services with Fraudulent Operation of Special Needs Pooled Trusts 

The SEC alleges that Lazarus and Prieto formed the Foundation for Those with Special Needs, Inc. as a non-profit company to “assist personal injury victims with special needs.” The defendants, however, concealed from the beneficiaries, the Internal Revenue Service, and the Social Security Administration that they diverted at least $775,000 in trustee and joinder fees directly from the beneficiaries’ accounts to their for-profit business, Synergy. The SEC also alleges the defendants improperly used funds from deceased beneficiaries’ accounts to reimburse themselves, sponsor events and parties, and promote Synergy’s for-profit business. Synergy, Lazarus, and Prieto allegedly also did not tell beneficiaries they were investing beneficiaries’ money in a certain class of mutual fund that doubled the fees the beneficiaries were told they were paying.

by SEC Press Release

People

Katie Hopkins, formerly with the SEC's Division of Enforcement, is joining Nasdaq as Associate General Counsel. (LinkedIn)

Twitter

This is how we talk now: "Bored Ape Metaverse Frenzy" Raises Millions, Crashes Ethereum". (If it helps, the article was later updated with the new headline, "ApeCoin Drops After Ethereum-Crashing Record Virtual Land Sale.")

The Bitcoin Twitter beef of the day is between Warren Buffett, Charlie Munger & Co., who think Bitcoin is "stupid and evil," and a whole bunch of Bitcoin moguls/crypto fans.

One one side:

A small sample from the other:

This all comes after Peter Thiel took aim at Buffett as being Bitcoin’s "enemy number one" and part of a "finance gerontocracy" that wants to banish cryptocurrencies from the mainstream. Thiel also branded Buffett a "sociopathic grandpa from Omaha."

Hope not!: